Volvo Quarterly Sales Plunge but Orders Cheer Market

STOCKHOLM -- Heavy truck and construction equipment maker Volvo (IW 1000/100) Thursday reported a quarterly loss as sales plummeted to their lowest since the financial crisis, but said orders were rising as customers grew more confident.

The company made a first quarter net loss of 304 million kronor (US$ $46.2 million) compared with a 4.05 billion profit in the same period a year ago.

"The sales volumes were the lowest since the financial crisis and were on the level of the first quarter of 2009," chief executive Olof Persson said as the company announced a 25% revenue fall.

The company warned in February that the first quarter would be difficult as order intake in the fourth quarter of last year had been weak.

But in a sign that an industry-wide slump is ending, orders in the January to March period rose 30%.

"The uncertainty seen the end of last year has given way to more certainty," Persson said at a press conference.

Describing the quarter as "transitional", the company noted that a high number of product launches this year meant it had incurred higher development and sales costs.

Rival Scania on Tuesday also announced surge in orders, as it posted a 22% decline in net profit.